Safer Streets Pay Off for Businesses

When policymakers think about changing a street, economic factors weigh heavily. Objections from business owners can prevent the installation of bike lanes, traffic-calming measures, and sensible parking pricing.

As a result, making the economic case for re-designing streets is imperative. But how do you measure the financial impact of more human-centric design?

Business owners in a tough economy are often wary of any kind of change.

The New York City Department of Transportation, which installed dozens of pedestrian plazas and hundreds of miles of bike lanes over the last six years, wanted to know. They found that no one had developed a compelling model. So the agency set out to create its own methodology.

Using tax data from the New York City Department of Finance, the DOT analyzed the impact of street re-design and transportation enhancements on retail businesses. Laid out in "The Economic Benefits of Sustainable Streets" [PDF], the data show encouraging results in seven test cases taken from three of the city's boroughs, representing a wide range of neighborhood types.

The DOT compared sites where a variety of improvements had been implemented by the DOT to spots nearby and with the borough as a whole.

Overall, the numbers revealed broad economic benefits for the streets that had been changed. One example was Columbus Avenue, a busy shopping boulevard on the city's affluent Upper West Side. There, the DOT had built a protected bike lane and pedestrian safety islands while narrowing travel lanes for motor vehicles. According to the tax data, revenue was up 20 percent over the baseline in the second year after bike lanes were implemented in the area.

In the comparison area immediately to the south without bike lanes, revenue was up 9 percent. The results are particularly interesting because a handful of vocal shopkeepers in the affected area had reported sales were down, leading to media reports that the lanes were bad for business.

Columbus Ave. Image courtesy of the NYC DOT.

Another test case was the Hub, a congested and chaotic intersection in a working-class neighborhood of the South Bronx, where several subway and bus lines come together. DOT's main improvements here were changing traffic patterns and improving transit connections, along with better pedestrian signals, crosswalks and shade trees.

Retail sales were up 50 percent by the end of the study period, compared with 18 percent in the borough as a whole, "all while area injuries were reduced and vehicle travel times and volumes were maintained."

The Hub before (left) and after (right). Image courtesy of the NYC DOT.

On Fordham Road in the Bronx, where the implementation of a "Select Bus Service" express route and dedicated bus lane raised concerns among local merchants about lost parking spaces, sales increased 71 percent over the baseline, far better than the numbers for all but one of the comparison areas.

The DOT report acknowledges that it's difficult to tease out all the different factors that contribute to a street's economic health. In at least one of the test areas, a beautified Vanderbilt Avenue, overall gentrification – with all of its collateral damage to less affluent residents and business owners -- was doubtless a contributor to a steep rise in sales numbers. But the NYC DOT's data-driven approach is as valuable when it comes to money as it is when it comes to safety.

Business owners in a tough economy are often wary of any kind of change, especially when it reduces parking or changes their customers' travel patterns in any way. Numbers like these provide yet another powerful rational argument for street design that puts people above cars.